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Highlights
- Bidco, controlled by Joshua Alliance, is acquiring N Brown Group in a £191 million deal.
- Shareholders will receive 40p per share, representing a significant premium to recent share prices.
- Eligible shareholders can opt for unlisted Bidco shares instead of cash, but they will not be publicly traded.
The board of directors of Falcon 24 Topco Limited (Bidco) and the independent directors of N Brown Group plc (LSE:BWNG) have announced a definitive agreement for Bidco to acquire the entire issued and to-be-issued share capital of N Brown, not already owned or controlled by Joshua Alliance. This acquisition, backed by Bidco, a company owned by Joshua Alliance, will be executed through a court-sanctioned scheme of arrangement under Part 26 of the Companies Act.
Joshua Alliance currently owns or controls 30,943,800 N Brown shares, representing 6.6% of the company’s issued share capital. Additionally, members of the Alliance Family Concert Party, of which Joshua Alliance is a part, control another 53.4%, or 249,915,491 shares. Together, this group already controls a majority stake in N Brown. The acquisition seeks to purchase the remaining shares from independent shareholders under favorable terms.
Details of the Cash Offer:
Under the terms of the acquisition, independent shareholders of N Brown, excluding Joshua Alliance, will receive 40p in cash for each N Brown share they hold. This offer values N Brown’s entire issued and to-be-issued share capital at approximately £191 million on a fully diluted basis.
The Cash Offer represents a significant premium to recent trading prices, including:
- A 111% premium to the volume-weighted average price of 19.0p per share over the past 12 months.
- A 63.8% premium to the 90-day average of 24.4p per share.
- A 48.1% premium compared to the closing price of 27.0p on the Latest Practicable Date.
Shareholders’ Choice: Cash or Consideration Shares
As an alternative to the Cash Offer, eligible N Brown shareholders may choose to receive unlisted ordinary shares in Bidco (referred to as "Consideration Shares") instead of the 40p per share cash option. Each Consideration Share will be issued on the basis of one for every N Brown share held. These shares will not be publicly listed or easily transferable, though certain exceptions apply.
Eligible shareholders who do not actively choose the Share Alternative will automatically receive cash for their shares. Special arrangements are in place for participants in N Brown’s share schemes, following Rule 15 of the Code.
While the Consideration Shares offer an alternative, they will not be listed, and their valuation will be detailed in the Scheme Document along with an estimate provided by Investec, Bidco’s financial adviser. Bidco will later offer Rollover Shareholders an opportunity to subscribe for additional new Bidco shares to support the company’s working capital needs, with the option for shareholders to apply for excess entitlements.
